-Brian and Matt Own the Only Two Bicycle Repair Shops

question 28

Multiple Choice

-Brian and Matt own the only two bicycle repair shops in town.Each must choose between a low price for repair work and a high price.The yearly economic profits from each strategy are indicated in Figure 11-12.The upper right side of each rectangle shows Brian's profits;the lower left side shows Matt's profits.Which of the following statements is correct for a one-trial game?

• A)The market equilibrium price is the high price.
• B)A market equilibrium price cannot be established unless Brian and Matt collude.
• C)A market equilibrium price cannot be established unless Brian or Matt engages in tit-for-tat strategy.
• D)A market equilibrium price cannot be established without repeated trials.
• E)The market equilibrium price is the low price.

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Definitions:

Packaging

The technology and art of enclosing or protecting products for distribution, storage, sale, and use.

Long-term Impact

The enduring effects or outcomes of a policy, strategy, or action, extending well into the future.

Purchasing Goods

The process of acquiring products or commodities for use, sale, or incorporation into further manufacturing or service delivery.

Carrier's Ability

A transportation or logistics company's capacity to provide effective delivery services, including speed, reliability, and coverage.